The Japanese electronics giant Sony and the Swedish mobile phone company Ericsson have agreed to integrate their mobile phone handset businesses.

Sony Ericsson may produce handsets

Details of the joint venture will be revealed at a press conference in Stockholm onnTuesday, the companies said.

A new company, which will be set up in the UK, will be named Sony Ericsson, according to press reports.

Each of the companies will own 50% of the new venture, which will oversee the development, product planning and sales of mobile phone handsets.

Ericsson's vision of the next generation mobile phones

It's chairman will be Ericsson's chief executive Kurt Hellstrom, according to press reports.

"This would be good for Sony in the sense that it could expand its distribution channels and boost production," said UBS Warburg analyst Masahiro Ono.

Ericsson, which recently announced it is pulling out of mobile handset production, would benefit from links with Sony because its electronics products are seen as innovative and are popular with consumers, said analysts.